Ricketts Signalling to Reduce Payroll Reason for Theo’s Departure?

Ok, let’s not ignore the COVID-19 effect that will cause most MLB teams to reduce payroll in 2021. That is a major reason that you will find most teams using when reducing their payroll, and rightfully so. While, yes, there was a report that Major League Baseball is preparing for fans in the 2021 season, but teams saw upwards of 70% less revenue in 2020 than 2019 and have record amounts of debt.

But above all of these things, the Chicago Cubs were already in financial trouble. The launch of Marquee Sports Network was a failed endeavor, since they didn’t join Comcast till just before the season started, have never made it to YouTube TV, and now Hulu Live has dropped them. Then add a loss of 100 games and the startup costs – this network isn’t going to meaningfully impact the baseball budgets as it was sold to do.

This isn’t an egg on your face, shame on you type of thing. This network was in the plans since 2013ish. The network, at that time, would have been lucrative. Look to the New York Yankees and the Los Angeles Dodgers, these were billion-dollar additions to the organization’s coffers. But, the Cubs had to continue on through half-hearted agreements with WGN, ABC, NBC Sports (and seemingly any other Chicago-based local station willing to carry a Cubs game) until this past season. When doing so it cost the Cubs millions upon millions of dollars on this TV deal, a TV deal that could end up falling apart with an industry that is moving further and further away from the old model of broadcast TV.

On top of this, the Cubs have been top three in payroll for the past three seasons, and have flirted with the league’s Competitive Balance Tax for the past five. This has caused the Cubs to face tax penalties and if they do not reduce payroll for the 2021 season, they will face the sternest taxes available under the CBT.

On top of it, it seemed that a number of National League teams had passed them in the competitive mix. With the Dodgers leading the way, it seemed like the ability to compete for a World Series was over.

This is why many believed that there was a directive to reduce payroll. The club had issued out $20m AAV deals like they were going out of style. Then the young core continued to earn more and more through arbitration, continuing to expand a growing payroll without the continued success.

It was this directive from ownership that helped Theo Epstein make his decision to step down. In his letter (The Athletic $$$), Theo mentions COVID and the new undertaking that the franchise will undergo as reasoning to move on, and allow new leadership to make the necessary changes that will affect the team for years to come. He also gives a nod to allowing Jed Hoyer to work without him peering over his shoulder.

Let’s applaud Theo for his time, regardless of his more recent misses. But let’s continue to hold Tom Ricketts and the Cubs ownership responsible for their parts in what is next. Yes, they could not predict COVID-19, and they couldn’t predict that they would lose 70% of their revenue in the same year they launched a TV network. But, they can be called to task for their failure to continue to build upon the team’s popularity, failure to accurately predict the landscape and how to build a network, the failure to read the room on occasion, and the failure to uphold the promise made to fans as fans themselves.

This should signal to all Cubs fans that this team is about to be torn apart. There should be no reason to expect Kris Bryant or Kyle Schwarber to be back with the team in 2021. There is a smaller chance of seeing Javier Baez return as each day goes by, and I would believe the only holdouts from the championship team in 2016 would be Anthony Rizzo and Willson Contreras.

Contreras will be kept as he is a special talent and very affordable. By moving on from KB, Schwarber, and Baez the team will free up more than enough money to retain Contreras for several years to come. Rizzo will be retained as this club cannot make it through a dark period without a fan favorite draw. He will be tasked with keeping fans in the seats (if they are allowed) and should see a reasonable extension offered before the end of the winter.

I can see the Cubs finding a trade partner for Schwarber and Baez. Baez returning the most value. I don’t see the Cubs finding a way to trade Bryant and receive enough back in compensation. I also don’t know if other teams will be actively shopping for a player earning $18-20 million in 2021 with the ability to leave at the end of the campaign. While this *could* leave the door open for a return, possibly a shorter extension to punt trading him down the road. I don’t anticipate the club doing so and it opens the door to the team non-tendering him come December 2nd.

Over the course of the next several months, and certainly the next two or three years, this team will look very different. Familiar faces will be gone. Veterans will make way for unproven rookies. The fanbase will start to follow the minor league system with much more vigor, similar to the way we did in 2014-2015.

The next chapter has begun. In fact, it will likely feel more like a new book. This is the J.J. Abrams version of the Star Wars universe as opposed to the George Lucas version. Lucas was able to provide us with enjoyable winners like A New Hope, Empire Strikes Back, and Return of the Jedi, similar to the first half of the Theo-led Cubs. Now we will look to the Jed Hoyer version with optimism, but will we see carbon copies of the past without the development of characters (ahem, Snoke) and casting away our favorites (Han Solo and Luke Skywalker)?